Stake Solana with Kiln - enterprise-grade staking
What is Solana?
Solana is a public and high-throughput layer-1 blockchain platform with smart contract functionality. Its native cryptocurrency is SOL. This open-source project was launched in 2017 and is currently run by the Solana Foundation based in Geneva. Solana is often compared to Ethereum, but while Ethereum has the first mover advantage, Solana has strong distinct advantages over it in terms of transaction speed and costs.
Is Solana a Proof-of-Stake blockchain?
The Solana network uses an iteration of the Proof-of-Stake (PoS) consensus mechanism called delegated-Proof-of-Stake (dPoS). This network also incorporates an innovative Proof-of-History (PoH) timing mechanism that is implemented prior to, and facilitates, its Proof-of-Stake (PoS) protocol structure. Proof-of-History (PoH) is a sequence of computation that can provide a way to cryptographically verify the passage of time between two events. Discover more info in the Solana Whitepaper.
How is Solana Delegated Proof-of-Stake implemented?
Anyone can delegate some SOL tokens to a validator (or “vote account”) that participates to the consensus of the Solana chain. A vote account cannot be selected as a leader if no SOL are delegated to it. The more stake assigned to the validator, the more often it is chosen to write new transactions, and therefore the more it earns rewards.
What is staking?
Proof-of-Stake protocols use staking to create consensus. By locking native tokens into a smart contract you earn the right to secure a chain and earn rewards on your stake. Due to its environmental efficiency, staking has overtaken mining and is used far more often in newer protocols.
By locking a protocol’s native tokens (ie SOL) to give “validators” the right to secure a chain. Validators propose new blocks or attest other validators’ blocks, gaining rewards for doing so.
Why should you stake your assets?
Staking generates predictable yields and is considered a safe way to build capital. It is the most natural yield feature in crypto as the value originates from the blockchain’s native currency inflation. You help secure the network and earn rewards by staking your SOL.
Not staking holds back the network’s inflation. Your token share will be diluted among other people’s tokens that are being staked and accumulating new tokens into the network.
If you do not stake, your assets will be eroded from protocol inflation.
- Put your treasury to work
- Diversify and earn
- Bring new opportunities to generate safe yields to your users
How to stake Solana with Kiln?
There is no minimum token requirement to delegate. You can start staking with as little as 0.01 SOL. To stake SOL, you’ll only need to access Kiln dashboard. Select the Account you want to stake on and the amount of SOL and connect your wallet:
- Login to the Kiln dashboard
- Initiate Stake by selecting your Account and the amount of SOL
- Connect your wallet: Phantom, Ledger, Sollet,… Kiln supports multiple wallets as well as WalletConnect
- Confirm the staking transaction
- After the bonding period (2 epochs) you will start earning rewards
To unstake, you simply need to undelegate into one transaction, after 2 epochs you will receive your original stake back in your wallet as well as accumulated rewards from delegation.
What are the rewards associated with staking SOL?
As an incentive for helping to safeguard the network, you can earn up to 4.69% APR* from each SOL validator you stake on Kiln.
Why should you stake your SOL with Kiln?
Kiln is the leading enterprise-grade staking platform, enabling institutional customers to stake SOL, and to white-label Solana staking functionality into their offering. Our platform is API-first and enables fully automated validators, rewards, data and commission management.
We are serving thousands of businesses worldwide so that everyone can securely and seamlessly. Our clients can stake their coins from our dashboard, a hardware wallet, a browser wallet, a B2B custodian, a crypto exchange or just their favorite investment app. Kiln makes staking Solana easy, secure, and accessible to everyone.
- Stake SOL in 1 click
- 99% rewards guarantee
- Manage all your SOL stakes and rewards from a single dashboard
- Non-custodial, work with your existing custodians solutions e.g.Fireblocks
- SOC 2 certified and Industry leading SLAs (0 penalties recorded and 99.95% effective uptime)
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Stake Solana FAQ
What does Proof-of Stake mean?
Proof-of-Stake (PoS) is a type of consensus mechanism used to validate cryptocurrency transactions. Through PoS, validators can contribute to the block production of a chain while keeping environmental concerns to a minimum, which is becoming an increasingly large issue in Proof-of-Work, the consensus algorithm used in Bitcoin.
By staking capital rather than energy, validators risk losing a portion of their value and future potential for staking by misbehaving while creating blocks. This incentivizes collaboration and minimizes malicious activity in the consensus process.
What is the difference between PoS and dPoS?
Both are consensus algorithms, helping to democratize participation in securing a blockchain. dPoS is an iteration of PoS combining real-time voting with a system based on reputation to reach consensus across the blockchain. Voting power is still determined by how many tokens they have however.
When will I receive SOL rewards?
SOL rewards are issued once per epoch in your staking account, meaning SOL rewards compound. An epoch of time in Solana is approximately two days. Note that the staking yields vary for each epoch as the inflation rate and total active stake change.
Does interest compound when staking SOL?
Yes, the interest you earn over each reward period is added to the principal balance so that eventually you earn interest on your interest, and can grow your wealth exponentially.
What are the risks associated with staking SOL?
Solana implements a slashing mechanism for poor promotion. This includes downtime for validators and their delegators and for nodes that attempt to vote on two separate attestations at the same time. Slashed validators will add bonded tokens to the mining pool.
Slashing also occurs if Solana’s Proof-of-History generates an invalid hash.
Is there a minimum and maximum amount to stake for Solana?
You can start staking SOL with 0.01 SOL and there is no maximum stake.
Do I maintain custody of my SOL tokens? Is SOL staking non-custodial?
You can maintain custody of your SOL through any wallet or custodian solution of your choosing. Kiln’s SOL staking is non-custodial, only you can access your funds by controlling the underlying wallet which holds a claim to the funds.
What is the lockup period to stake Solana? When can I unstake and withdraw my SOL?
It will take between 1 and 2 epochs for your SOL to be unstaked (48-96 hours).
How do rewards and penalties work?
For every slot, the validator is expected to sign attestations. If submitted attestations are good, the validator receives rewards, otherwise it receives penalties. In case the validator is offline it will also receive penalties.
What is the average block time on Solana?
The average block time on Solana is ~400 milliseconds.
What are the specificities of a Solana validator?
There are no strict minimum amounts of SOL required to run a validator on Solana. However, in order to participate in consensus, a vote account is required to have a rent-exempt reserve of 0.02685864 SOL. Voting also requires sending a vote transaction for each block that the validator agrees with, which can cost up to 1.1 SOL per day. From an infrastructure point of view, a vote account is defined by 3 keypairs:
- Validator identity: a SystemAccount used to pay the transaction fees of all the vote transaction fees submitted to the Vote Account
- Vote authority: used to sign each vote transaction the validator wants to submit to the cluster
- Authorized withdrawal: used to withdraw funds from a vote account
What is an Annual Percentage Rate (APR) and how is it different from Annual Percentage Yield (APY)?
APR, or annual percentage rate, is the fixed interest rate earned on an investment over a one-year period. It is the percentage of return investors can expect to receive on their investment. On the other hand, APY or annual percentage yield, takes into account the compounding of interest on a fixed schedule. It includes both the interest earned and the interest on previously earned interest.
When it comes to PoS protocols, compounding does not always apply as additional validators can be needed to stake more. Therefore, APR is used instead of APY. It's worth noting that APY and APR cannot be compared directly, as they measure different things. However, it is possible to convert APR to APY and vice versa.